Vertical: Automotive & Industrial Wholesale Distribution 

A distributor in the automotive and industrial wholesale space wanted to drive profitable growth by enabling the purchasing team to make data-driven decisions using inventory stratification. 

The Roadblock 

The distributor was experiencing several issues related to inventory management. 

  • The purchasing team was struggling to make profitable buying decisions. 
  • The inventory team was struggling to make inventory reduction decisions. 
  • The buyers lacked the training and coaching to apply inventory analytics in daily decisions. 

How ActVantage Helped  

The distributor enlisted our services and we helped them deploy inventory stratification to optimize inventory management and their buy/stock strategy. We used actionable product intelligence from inventory stratification to develop category-specific growth playbooks. We also introduced an easily accessible cloud-based analytics platform for the purchasing team.  

To ensure the success and sustainability of the analytics program, we focused on the PEOPLE aspect of the implementation, as follows: 

  • Coached purchasing managers to use inventory analytics and optimize spend 
  • Trained buyers through micro-learning on:
    • Which categories/items to focus on 
    • How to increase inventory turns 
  • Provided quarterly updates of playbooks and ongoing training reinforcement 

What is inventory stratification?  

Inventory stratification involves analyzing inventory data to determine rankings for items. Relevant data and determining factors will depend on the distributor’s specific industry and environment. Item rankings help distributors make informed decisions around stock and purchasing.  

The Difference 

The distributor was able to optimize working capital investment by improving inventory performance across locations. They also increased profitability by identifying opportunities to increase Gross Margin Return on Inventory Investment (GMROII). Customer experience also improved – via product availability – through a systematic approach to inventory management.  

About ActVantage 

At ActVantage, we are a people-centric industry partner. We help distributors drive profitable growth through analytics and talent development. We take a holistic approach, integrating people, process and technology to improve distributor performance in four areas: 

  • Sales 
  • Supplier Management 
  • Inventory 
  • Pricing 

We have conducted over 750 client engagements over the past 15 years, and we’ve provided coaching and micro-learning to thousands of professionals in the past 10 years. We apply field-tested principles which we also share in our seven best-practice books published with the National Association of Wholesaler-Distributors.  

Why ActVantage? We let our clients answer! 

By allowing you to set your own parameters, Actvantage brings clarity to the things most important to running your business. They immerse themselves into the business, and the personal attention delivers results. The efficient, user-friendly way they deliver data to the team is nothing less than amazing. Danny Bates, SVP, Valley Solvents and Chemicals 

We reduced our slow-moving, less profitable inventory by more than 20%. CEO, Building Materials Distributor 

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